2016 (4) TMI 1027 - HC - Central Excise

Territorial jurisdiction to entertain the petition - Seeking direction for refund of central excise duty - Petitioner purchased coal from respondent No.5 and being a SEZ Unit, claimed exemption from payment of excise duty on such coal - Held that - whatever be the ground for challenging the adjudicating authority and appellate order, the fact remains that both the Excise Authorities are situated at Orissa. Further appeal against the order of the Appellate Commissioner would be competent before the jurisdictional CESTAT. Any further proceedings would, therefore necessarily lie before the High Court at Orissa. Merely because in the case of Messrs Anita Exports & anr vs. Union of India and ors 2014 (12) TMI 361 - GUJARAT HIGH COURT export, this Court has given its expression on interpretation of statutory provisions which may be applicable in the present case would not permit us to examine the orders of the Excise Authorities situated at Orissa. Quite apart from that, therefore, the question of alternative remedy being available before the concerned CESTAT, on the question of territorial jurisdiction, we are not inclined to entertain this petition. - Petition disposed of

Summary

Issues: Territorial jurisdiction of the High Court for challenging excise duty refund orders.

Analysis:
1. The petitioners sought to quash an Order-in-Appeal passed by the Commissioner (Appeals) regarding the refund of central excise duty amounting to 44.34 crores. The respondents opposed the petition primarily on the grounds of territorial jurisdiction.

2. The petitioners, a unit in a Special Economic Zone, had purchased coal from a supplier in Orissa and claimed exemption from excise duty. Their refund applications were rejected by the Deputy Commissioner and the Appellate Commissioner, who doubted their jurisdiction to entertain the refund claims due to the SEZ location. Despite considering the jurisdiction issue, both authorities denied the refund, prompting the petitioners to challenge these orders. The respondents raised concerns about territorial jurisdiction in response.

3. The petitioners argued that the High Court's writ jurisdiction can extend extraterritorially, citing the consumption of coal at their SEZ unit as a significant part of the cause of action. They relied on legal precedent to support their position.

4. On the other hand, the Department's counsel contended that since both Excise Authorities were in Orissa where the refund claims and appeals originated, the High Court lacked jurisdiction to hear the petition. The appellate order was also appealable to the CESTAT, further supporting the argument against the High Court's jurisdiction.

5. The Court noted that the Excise Authorities involved were located in Orissa, and any further appeal would be within the jurisdiction of the CESTAT in Orissa. Despite the legal precedent cited by the petitioners, the Court held that the High Court did not have territorial jurisdiction to entertain the petition challenging the excise duty refund orders. Therefore, the petition was disposed of accordingly, emphasizing the availability of an alternative remedy before the CESTAT in Orissa.